Indian aviation experienced unprecedented traffic in November, with IndiGo transporting over 10 million passengers, Air India surpassing 3 million, and Akasa Air achieving its highest monthly performance to date.
The Directorate General of Civil Aviation (DGCA), which oversees India’s aviation sector, reported that November 2024 marked the highest traffic levels ever recorded in the history of Indian domestic aviation. This extraordinary growth positively influenced both airports and airlines, with Delhi airport noting its peak month thus far. Furthermore, three airlines experienced exceptional performance during this time.
IndiGo’s November achievement
IndiGo reached a significant milestone by becoming the first airline in India to transport over 10 million passengers within a single month. Out of this total, 9.07 million were domestic travelers, while the rest were international passengers. This event represented the airline’s highest count of domestic passengers since it began operations 18 years ago, eclipsing the previous records of 8.64 million passengers in October 2024 and 8.52 million passengers in December 2023. December 2024 is expected to break further records.
This achievement propelled IndiGo’s market share to an unprecedented level of 63.6 percent. This success comes against the backdrop of the airline acknowledging a normalization in demand and pressures on yields, as highlighted in its Q2FY25 financial results. Despite reporting a loss after seven consecutive profitable quarters, IndiGo’s domestic operations have now expanded to 1.5 times their pre-Covid-19 scale, with even more substantial growth observed in international operations, according to the report.
Air India benefits from merger
Air India, along with its subsidiary Air India Express, transported 3.47 million passengers in November, capturing a market share of 24.4 percent. The airline recently completed its merger with Vistara, which functioned as a separate entity for the initial eleven days of November. The DGCA also considers the passenger numbers from Air India Express as part of Air India’s overall performance, as noted in the report.
For the first time, Air India managed to serve over three million domestic passengers within a single month. This number is anticipated to rise in December, marking the first complete month of operations following the merger into two streamlined entities: Full-service Air India and low-cost Air India Express. In spite of this achievement, Air India’s market share fell to 27.3 percent in November from 29.2 percent in October, when four airlines were in operation.
Akasa Air’s flight to recovery
Based in Mumbai, Akasa Air is regaining its footing after facing challenges in 2023 due to pilot shortages, which resulted in decreased utilization and lower passenger counts. In November 2024, the airline transported 674,000 domestic passengers, capturing a market share of 4.7 percent. This represents a new peak, exceeding its previous high of 664,000 passengers in May 2024 and 629,000 passengers in May 2023, according to the report.
Akasa Air is confronted with challenges, including competition for capacity from SpiceJet’s wet-leased aircraft and plans to resume operations with its fleet. Although maintaining market share is vital, profitability remains a primary focus for the airline.
Aviation industry outlook
India’s domestic aviation sector in 2024 has already eclipsed its traffic figures from 2023. December 2024 is poised to be another record-setting month, with passenger traffic 3 percent above November’s levels. The industry has reached notable milestones, including surpassing the 500,000 passengers-per-day threshold multiple times.
However, the annual growth in passenger traffic overall has been relatively modest, fluctuating between 5 percent and 6 percent. Nonetheless, airlines are encountering pushback against fare increases, a subject that has even sparked discussions in Parliament.
Air India – Sole full-service carrier in India
Following the completion of the merger, the landscape of India’s full-service carriers (FSC) has been dramatically transformed. Air India now operates as the only FSC in the nation, a significant shift from the five that were present 17 years ago. This change signals the conclusion of yet another Indian airline that was partially owned by a foreign carrier, a trend that accelerated after the liberalization of foreign direct investment (FDI) regulations in 2012.
Air India-Vistara Merger – A strategic move
The merger of these two airlines is regarded as a strategic maneuver aimed at establishing a more competitive and financially robust entity capable of challenging the titans of global aviation. With a combined fleet exceeding 250 aircraft, the newly merged airline, operating under the Air India brand, now possesses an extensive domestic and international network, positioning itself as a formidable player.
The merger represents the culmination of years of strategic development by the Tata Group, which took ownership of Air India in 2021. Under Tata Sons’ leadership, the group has set ambitious targets for Air India, aiming to restore its former glory and evolve it into a world-class airline. The acquisition of Vistara was a logical progression in this vision, enabling the group to consolidate its aviation resources and enhance operational efficiency.
What’s next – Economic, operational impact
The merger also carries significant implications for India’s economy. By streamlining operations, the new entity is anticipated to realize substantial cost reductions, enhance profitability, and bolster the airline’s resilience in an increasingly competitive global landscape.
The merger greatly strengthens Air India’s capacity to compete with other international airlines, especially within the long-haul international sector. The revitalized Air India will establish a more robust presence on crucial international routes, particularly connecting to and from markets in the United States, Europe, and Asia.
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